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Fundamental analysis: Archer-Daniels-Midland Company (ADM)

Awarener score: 6.8

Conclusion

Note: All scores range from 1 (worst) to 10 (best). Conclusions are updated daily with closing stock prices and new reported quarterly financial statements.

Revenue score: 6.5

• Business has been growing at a low pace. It's been similar to peer companies.
• Archer-Daniels-Midland Company business trend stability is good. The higher the stability, the lower the risk. It looks somewhat better than rivals.

Margins score: 4.8

• ADM profit margins -on goods and services sold- are usually destitute. They stand mediocre against rival companies.
• Business profit on sales tends to be sufficient. It's encouraging in relation to competitors.
• Profits on sales made -available to repay debt and purchase properties- are usually hardly sufficient. They remain close to average when compared to peers.
• Earnings -before income taxes and interests on loans taken- tend to be hardly sufficient in relation to total revenues. They're still well ranked against similar companies.
• Profits -before income taxes- are usually sufficient considering total sales, and remain similar to rivals.
• Total net profit tends to be sufficient when confronted to sales. Company stands encouraging in relation to comparable firms.

Growth score: 6.9

• Archer-Daniels-Midland Company profit -on goods and services sold- has been growing at a normal pace. It's been close to average when compared to competitors.
• In recent years, earnings -on operations- have been growing at a normal step, which has been slightly worse than comparable firms.
• Profits -available to repay debt and purchase properties- have been growing at a good pace, which compares almost average when measured against peer enterprises.
• Earnings -before income taxes and interests on loans taken- have been growing at a good tempo. It turns to be lacking compared to similar stocks.
• In past years, profits -before income taxes- grew at a very good speed. It was somewhat worse than rivals.
• In the previous years, growth trend on total net profit has been good, and below average when measured against peer companies.
• Earnings per share have grown at a good rhythm in past years. It's been lacking compared to industry peers.

Miscellaneous score: 8.0

• ADM managed to pay little to no income taxes on profits made in the past years. It's been top-notch against peers.
• The company does not report R&D expenses. It's meaningless to measure in relation to competitors.
• We have insufficient data to estimate how effective is research and development effort. It stands unknown against rival companies.

Profitability score: 8.0

• Archer-Daniels-Midland Company usually gets very good returns on the resources it controls. It proves encouraging in relation to peer firms.
• The company normally gets very good proceeds -on the resources directly invested in the business-. They remain rather normal in relation to similar companies.
• There's usually abundant profitability -in relation to owned resources-. It ranks similar to competitors.
• In the past, got very good returns -on the tangible resources it controls-. This metric is usually related to the industry in which operates and combines profitability versus reinvestment needs. It's encouraging in relation to comparable enterprises.

Usage of Funds score: 5.1

• ADM usually uses a very large portion of genuine funds generated to buy or replace property, plant, or equipment. The need for reinvestments is heavy. It stands encouraging in relation to rival firms.
• The company is usually replacing the property, plant, and equipment that gets old, keeping its operating capabilities up to date, which is weak when measured against industry peers.
• In the past twelve months it paid some dividends, considering the current stock price. It came slightly worse than competitors.
• Dividend payments have been more or less stable in recent years. The company has behaved close to average when compared to similar firms.
• The company usually uses a large portion of genuine funds generated to pay dividends. There could be some concerns on sustainability if business takes a dive. Sustainability looks worse than most comparable companies.
• The company usually neither enlarges nor reduces the pool of investors, resulting in approximately the same mouths feeding on the pie of profits. It remains a slight improvement compared to peer enterprises.
• Repurchase effectiveness metric is very complex. Run again in analytical mode if you're interested in a technical explanation. It stands a slight improvement compared to rivals.
• The company uses somewhat more funds to reward investors than it can genuinely generate, so some part of them is paid out of existing cash or by borrowing money, both of which will eventually reach a limit. Either business somewhat improves, or rewards will probably not be sustained at this pace. It still looks substantially worse when measured against competitors.

Balance Sheet score: 6.9

• Archer-Daniels-Midland Company intangible assets (like brands and goodwill) represent a modest portion of resources controlled, according to accounting books. There could be some difficulties in liquidating them if the company ever gets in financial distress. It happens to be almost average when measured against peer companies.
• The company has a lot more short-term resources than short-term obligations. There're no liquidity concerns. It turns to be impressive in relation to similar firms.
• Roughly a quarter of resources controlled were provided for with financial debt. Creditors have some claims on the company. It remains somewhat worse than rival firms.
• Controlled resources take time to be turned into cash and equivalents, which is somewhat risky. It looks below average when measured against rivals.
• For every dollar of short-term obligations, the company has less than a dollar of cash and short-term receivables. It's in a very weak position compared to peer firms.
• For every dollar of short-term obligations, the company has almost another of cash and equivalents, which is slightly worse than similar enterprises.
• Usually, sales are mostly on cash. It still ranks great when measured against peers.
• Normally has no inventories. It comes up as impressive in relation to competitors.
• On average, it takes less than one month from the purchase to charging customers. It happens to be top-notch against peers.
• Pays suppliers mostly in cash. It ranks last-in-rank when measured against industry peers.
• The company pays its suppliers almost when charging its customers, so there's very little money invested in working capital. It's in good shape compared to similar companies.
• Net interest expenses consume a non-significant portion of usual business earnings, and are therefore extremely easily to bear. It stands well ranked against rival firms.
• Business earnings have usually been good when measured against loans taken. Cutting back reinvesting in the business, it could take less than three years to repay the obligations with current profitability. It ranks encouraging in relation to comparable enterprises.
• Revenues are very good in relation to property, plant, and equipment required to operate. This metric is likely dependent on the industry the company operates in. Low property, plant, and equipment requirements allows the company to keep more money to reward stockholders in the long run. It looks in good shape compared to similar firms.
• Resource exploitation is huge considering yearly sales, which is great. This metric is normally tied to the industry where the firm belongs. It's still better than most peer companies.

Valuation score: 6.9

• Archer-Daniels-Midland Company looks cheap in relation to profits and financial position. It happens to be similar to competitors.
• Price-to-Tangible-Book-Value is a fairly complex metric. Run again in analytical mode if you're interested in a technical explanation. It remains lacking compared to peers.
• In the past twelve months, the company neither generated nor consumed funds. Whatever funds it could generate, it reinvested in the business, which stands slightly worse than similar companies.
• The company usually generates somewhat more than enough genuine funds to cover up for its business needs. Surplus cash may be used to repay loans, to eventually buy new businesses, or to reward investors. Considering the financial position and stock price, the current valuation might be reasonable. It's still almost average when measured against industry firms.
• In the past twelve months, the company has barely rewarded investors, considering both dividends and share on the pie of earnings. It came up rather normal in relation to peer ventures.
• The company is somewhat indebted, loan repayment needs to be taken into account. It looks slightly worse than similar enterprises.
• Considering the past twelve months, traditional Price-to-Earnings relation looks cheap. Possible reasons are that the market might be betting current earnings will be hard to sustain through time, or that the company has very high fund needs, or a weak financial position, among others. If that isn't the case, the current stock price might be attractive. It ranks similar to peer companies.
• Comparing the current stock price with the past twelve-months revenues gives a low relationship. One common cause includes profitability being poor. It looks close to average when compared to rival firms.
• The relation between the stock price and accounting book value is somewhat high. It's important both to check this metric through time and to compare it with rival companies. The company remains somewhat worse than peer firms.
• In the past twelve months, the operating business earned great money when compared to the current stock price and financial position. It happens to be similar to industry peers.
• In an alternate metric of bang for the buck, the company has usually shown a very good earnings power ability when measured against the current stock price and financial position. It's still a slight improvement compared to peer companies.

Total score: 6.6

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Awarener score: 6.8

Conclusion

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